World Bank expands Lebanon aid package to $400m amid deepening crisis

Lebanon has secured a $250 million loan from the World Bank to address chronic electricity shortages, with preliminary approval granted to expand the package to $400 million, the country’s Finance Ministry confirmed this week.

According to Reuters, the funding comes as part of a broader $1 billion reconstruction programme unveiled by the World Bank in March, designed to help Lebanon recover from both long-standing infrastructural decay and the devastation caused by last year’s 14-month war between Hezbollah and Israel.

That conflict, which ended in November under a fragile US-brokered ceasefire which continues to be violated by the occupation state, further strained Lebanon’s already collapsing public services.

Finance Minister Yassine Jaber, who is leading Lebanon’s delegation to the IMF and World Bank spring meetings in Washington, said the concessional loans would carry a repayment period of up to 50 years.

READ: Lebanon waits for ‘right conditions’ to bring all weapons under state control: President

Speaking after a meeting with World Bank Vice President Osama Weden, Jaber detailed the proposed breakdown of the full $1 billion package: $250 million for electricity networks, $256 million for water infrastructure, $200 million for agriculture and $200 million for social affairs.

“We are not undertaking these reforms to satisfy the IMF or anyone else. We are doing them because we need them,” Jaber stated during a reception at the Lebanese Embassy in Washington, reaffirming the government’s commitment to reform.

Deputy US envoy to the Middle East Morgan Ortagus who was present at the event urged action, saying: “The only way is to strengthen the state, move forward with reform and completely revitalise the country.”

Lebanon has been mired in a financial crisis since 2019, following decades of corruption and mismanagement. The country defaulted on its debt in 2020, and its currency has lost more than 90 per cent of its value. International assistance has been largely conditional on the implementation of reforms, which successive governments have repeatedly failed to deliver.

READ: HRW accuses Israel of indiscriminate attacks on civilians in Lebanon